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Walgreens chief merchandising officer Linda Filler delivers a presentation at the 2015 NACDS Annual Meeting in Palm Beach, Fla.
DEERFIELD, Ill. — Linda Filler, president of retail products and chief merchandising officer at Walgreens, has always been fascinated by how consumers’ needs and wants translate into purchases.
Since her time at the Hanes division of Sara Lee she has sought to fulfill consumers’ desires with relevant, unique and fun solutions. At Hanes, she loved partnering with retailers “to bring those solutions to our shared consumers and customers,” she says. “Then when I went to retail, I loved partnering with suppliers.”
Filler is a big believer in optimizing the entire value chain with the consumer in mind. “The people who have worked with me will tell you that I’m very passionate about customer-led thinking and creation. It all works together in a wonderful way, and I feel a special sense of purpose here at Walgreens.”
That sense of purpose, she says, is shared across the company. The workforce is uniformly behind the retailer’s objective of championing everyone’s right to be happy and healthy.
“I think that’s a really profound mission,” Filler comments. “Our customers are telling us that we’re doing it better and better every day. A role in any kind of health and wellness-related field today is especially gratifying. It’s such an important part of our patients’ and customers’ lives. It’s top of mind and a big share of their heart too. They pay a lot of attention to the support they get, so being part of their solutions in the health and beauty world is particularly gratifying.”
Walgreens, she adds, has “an extraordinary legacy” from its history as a trusted pharmacy. But these days it is redefining the drug store paradigm. “And suppliers who innovate with us with that in mind — who innovate for our customers, and really think about how we can serve them best and evolve the channel — will win.”
The supply chain in particular, can be reinvented to unlock value that can be passed along to consumers, she says. A more efficient supply chain means less inventory, which allows for more funding in elements like novel store formats.
“We’re continuing to learn from all of our formats, and we’ve got a strong team measuring all the learnings from the different formats,” she says.
A key element of the Well Experience format, for example, is the increased capacity to help customers find effective health and beauty care products and be instructed in their use. Beauty advisors exemplify the mission of “bringing great, talented, trained associates to the aid of our customers,” says Filler.
Beauty is a focus, given its historic strength at Walgreens and the loyalty of beauty customers, who see the retailer as an important resource. “But we believe we have an opportunity to differentiate Walgreens further with our own brands, as well as with more premium brands, or exclusive programs,” she says. “We see this as an exciting area for delivering more under our happy and healthy banner.
The chain’s internal slogan is “Go big in beauty,” she notes. That refers not just to selection, but to experience. It means letting a woman interact in-store with a product — trying on a cosmetic or testing a fragrance before she makes a decision — perhaps with the aid of a trusted adviser. “We’re looking at all those possibilities, and expect to invest in the best opportunities.”
Some beauty offerings, such as skin care products, cross over into health care, leading shoppers to seek information from pharmacists. A pharmacist can discuss a product’s efficacy or ingredients, or how it relates to a particular disease state and a customer’s special needs. Consumers see the connection between health and beauty, says Filler, “so we want to think about how to maximize it, whether with store layout, adjacencies, assortment or service options. Its’ an important connection.”
Photo personnel, meanwhile, have established “better, newer ways of doing things, and our customers have really responded,” she notes. “We saw very strong growth in photo over the holiday, and we’ll see more to come.”
The Walgreens mobile app provides extensive photo functionality, including the ability for customers to print images or even canvases at any store.
Filler generally is heartened by the chain’s level of digital innovation. Tests are under way to link digital capabilities to the in-store experience to ensure a true, “seamless” omnichannel experience, she says. “There have been a lot of new things that we’ve brought to customers over the last months, and we’ll continue to try to leverage those.”
She is impressed with how much Walgreens has already learned about the marketing mix and relative return, depending on the type of media.
“There are some really good analytics around that, and so the focus is on being sure to match the particular type of media with that particular message at that time of year,” Filler says. “There’s some really good decision making being made as we continue to evolve. Going forward, like much of the world, we’re very interested in what else we can do with digital. There have been some real successes there and we want to build on them and continue to reach our consumer in all the different ways she wants to be reached today.”
Walgreens also continues to target its core shopper with the launch of private label lines such as this year’s masstige Circa and Nonie Creme Colour Prevails. The focus of store brands can be either innovation or added value.
The decision on which kind of private label lines to emphasize can be data driven, but merchandising generally is viewed by Filler as an art as well as a science.
“One of my favorite things about what we do is that it is about the science and the art,” she says. “One of the really gratifying things about my role as chief merchant is helping to be sure that we provide the best tools for our category managers and merchandising organization to make good decisions. And a lot of those do have a big analytic component. And that kind of discipline is really important, and we will be looking to improve the array of tools that our category managers have.”
A new promotional effectiveness tool, for example, will let category managers make better, timely decisions — with better forecasting — on where a promotion yields the most return, Filler notes.
“But there is a part of a merchant’s role that’s about imagining the future, and being sure that we move with innovation and imagination and creativity towards a future state, so there is an art to it, with a judgment factor that may not always be data-fueled. That’s important to a merchant’s capabilities.”
